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E.W. Scripps buys Ion Media in Berkshire-backed $2.65B deal

Yahoo Finance’s Brian Sozzi, Alexis Christoforous, and Ines Ferre discuss E.W. Scripps buying Ion Media.

Video Transcript

BRIAN SOZZI: Let's check out one of the hundreds of companies Yahoo Finance is watching today. TV station owner EW Scripps has inked a deal to buy Ion Media for $2.65 billion in cash. Warren Buffett's Berkshire Hathaway will get $600 million in preferred stock for helping to finance that deal. Yahoo Finance's Ines Ferre is back with more details. Ines, pretty sweet deal here, I think.

INES FERRE: It is a sweet deal. And just talking a little bit about what Scripps does and the number of television stations that it owns, it operates about 60 local TV stations. It owns Court TV, it also owns Bounce, it also owns that news platform, Newsy. So this deal could really double its local footprint when it comes to Ion Media. So part of the slide deck of the deal shows that Scripps will own 59 local television stations and 48 Ion stations in 76 markets.

Now Ion is based in West Palm Beach, Florida. Its TV stations, along with its affiliates, reach almost every American home in the US. The big reason for this deal is that Scripps can reach those viewers through what so-called the over the air network. And this is especially important as viewers are cutting cords, as they're going to streaming services, as they're watching free to air programming. And Scripps says that its own programming will reach nearly every American through free over the air broadcast, cable and satellite, and over the top and digital distribution.

Now Scripps used to be involved in the newspaper business as well, and also radio. It sold off those assets. It's only been focusing on TV. And remember, that for Berkshire Hathaway, it's sold off Lee Enterprises in January, just realizing that the newspaper business is very difficult to sustain. I would say television is also difficult, but for Scripps and acquiring Ion Media, this is a very big deal for the company. Right now, Scripps is up more than 16%. Brian.